Washington LNI Issues Draft Rules Amid Wave of Pay Transparency Class Actions

For nearly two years, Washington employers with 15 or more employees have been required to disclose within job postings a salary range or wage scale, any other discretionary or nondiscretionary compensation, and a general description of all benefits under a nascent law encouraging wider pay transparency. Creating opportunity for opportunists, many employers have been hit with a swath of class action lawsuits following the law's enactment, often brought by the same plaintiffs and alleging noncompliant job postings and seeking damages for all applicants. The law is described in greater detail in this earlier advisory, this webinar, and our previous alert on these lawsuits. 

Prior to these class action lawsuits, the Washington Department of Labor and Industries ("LNI") published an early Administrative Policy that provides employers at least some guidance on compliance. According to that guidance, employers must disclose within any job posting—which is considered to be any solicitation for a specific job meant to recruit applicants whether done directly or by a third party that includes a list of required qualifications—an expected wage scale for the position spanning from the lowest to highest amount to be paid for that position and a "general description of all benefits." 

Washington LNI Draft Rules: What They Could Mean for Lawsuits

Now, LNI has issued the first draft rules interpreting the law, which the agency says will help employers better understand how to comply with the law and help employees understand what protections the law provides. LNI is soliciting public comment on the new law and the draft rules, with any adoption of final rules likely to come mid-2025. Employers may attend one of several public meetings on the draft rules either virtually or in person to learn more or provide feedback. Alternatively, employers may submit public comment online.

In the class action lawsuits that have been brought, many of the employers sought to dismiss, arguing the plaintiffs lacked standing. Specifically, the employers averred that the plaintiffs in these cases were not "bona fide" applicants for the specific posted position because they did not in good faith intend to seek the job, were not seeking to represent a class of bona fide applicants, and did not in fact suffer a cognizable injury other than time spent applying. Some courts have agreed, holding that failing to disclose within a job posting salary, wage, and benefits information may be just a mere technical violation absent any actual tangible detriment to an applicant. 

What Is an "Employee"? What Is an "Applicant"?

On their face, LNI's draft rules appear to address several of these legitimate concerns. For example, the LNI's draft rules propose adopting stricter definitions for who an employee and applicant are and what actual damages must be shown for any purported violation:

• Employee: An employee who is employed in the business of the employee's employer whether by way of manual labor or otherwise. For purposes of this chapter, the term employee does not include independent contractors or business partners.
• Applicant: An individual, including existing employees, who submits in good faith an application for a job posting with the intent of gaining employment.
• Actual Damages: Compensation—including but not limited to, wages, salary, or other employment benefit—denied or lost to an employee or applicant, and many include other monetary loses suffered, as a result of the violation.

Employers should monitor these lawsuits and ensure full compliance for any job postings. Employers are also encourage to provide public feedback on these draft rules.

Davis Wright Tremaine is closely monitoring all class action lawsuits brought under this law and will periodically post updates. Employers with questions about the law are encouraged to contact legal counsel.